On July 30th local time, the Office of the United States Trade Representative (USTR) issued a statement stating that it will continue to review public opinions on the proposed amendments to the China 301 Act and expects the new tariffs to take effect approximately two weeks after the final decision is announced.
Previously, on May 14th, the US released the results of the four-year review of the additional 301 tariffs on China, announcing that on the basis of the original 301 tariffs on China, it would further increase the tariffs on imported electric vehicles, lithium batteries, photovoltaic cells, key minerals, semiconductors, steel and aluminum, port cranes, personal protective equipment and other products from China. The new import tariff regulations for electric vehicles and their batteries, semiconductors, steel and aluminum products, etc. will come into effect on August 1st.
On May 14th, a spokesperson for the Chinese Ministry of Commerce stated that China firmly opposes and solemnly expresses its opposition.
Received 1100 opinions
This time, USTR stated that it has received over 1100 comments from the public. After consultation with the Section 301 Committee, USTR will continue to review all opinions and is expected to issue a final ruling in August 2024 USTR stated in the declaration.
Yan Guangpu, an anti-dumping financial expert at Dao Yue Legal Consulting, told First Financial reporters that it is possible that the processing volume of over 1100 opinions is large, and USTR needs to continue reviewing them. However, considering the broad scope of taxation proposed by the US side, involving many industries, and the presence of over 1100 opinions is also normal, "relevant industries both domestically and internationally in the US will submit evaluations, and stakeholders may focus on it. There will definitely be voices of support and opposition
It is worth noting that after the news of the US insisting on raising taxes was released, many American business people and organizations expressed dissatisfaction with it.
For example, the US China Business Council (USCBC), consisting of 270 American companies doing business in China, expressed disappointment in the four-year Section 301 investigation results announced by USTR in a statement.
USCBC said, "We are disappointed with this result because maintaining the previous tariffs (without lowering them) and imposing additional tariffs will ultimately make it more difficult for American companies to compete domestically and overseas. This will lead to a decrease in American job opportunities. Against the backdrop of sustained inflationary pressures, this will also drive up the US Consumer Price Index
Previously, Chinese Foreign Ministry spokesperson Wang Wenbin introduced at a regular press conference on May 15th that according to Moody's calculations, American consumers bear 92% of the cost of imposing tariffs on China, and American households increase their expenses by $1300 per year.
Yan Guangpu also told First Financial reporters that there is a causal relationship between the soaring prices in the United States and the tariffs imposed by the US on high-quality and affordable products from China. "In fact, it has all been passed on to consumers in the end
Meanwhile, Yan Guangpu also believes that the effectiveness of the US continuing to impose tariffs or take anti-dumping measures is questionable. On the one hand, this has led to the spillover of Chinese industries. Taking the solid wood flooring industry he has been exposed to as an example, although the industry has moved to Vietnam, the final order demand has not increased, possibly due to weak domestic consumption in the United States.
In fact, multiple previous cases have proven that imposing high tariffs does not promote the development of domestic enterprises in the United States.
In 2002, the United States imposed tariffs on imported steel and aluminum products. Subsequent studies have shown that although this only resulted in an economic loss of around $30 million, it led to price increases in the US steel consumption industry and sharply reduced employment opportunities in the entire steel industry, especially for small businesses without market power to influence prices.
In 2009, the United States imposed tariffs on tires imported from China. The Peterson Institute for International Economics found in its research that this measure was believed to have saved about 1200 jobs in the US tire manufacturing industry, but it cost Americans $1.1 billion in the form of price increases.
The US' Section 301 'is a typical unilateralism measure
The First Financial News reporter learned from authoritative sources that at the meeting of the World Trade Organization (WTO) Council for Trade in Goods in early July, China expressed strong dissatisfaction and firm opposition to the US imposing new 301 tariffs on some Chinese goods and conducting new 301 investigations on China's maritime, logistics, and shipbuilding industries.
At that time, the Chinese side stated that they had noted the announcement by the United States on the same day that it would impose new tariffs ranging from 25% to 100% on various goods imported from China, including electric vehicles, lithium batteries, photovoltaic cells, key minerals, steel and aluminum, semiconductors, port cranes, etc., on top of the existing 301 tariffs. At the same time, the United States has launched a new Section 301 investigation into China's maritime, logistics, and shipbuilding industries.
The Chinese side expresses strong dissatisfaction and firm opposition to this, believing that additional tariffs have no legal basis under WTO rules and are a manifestation of unilateralism and trade protectionism.
The Chinese side stated that in September 2020, the WTO panel ruled that Section 301 tariffs violated WTO rules. The Chinese side stated that many American business groups have also called on the US government to lift tariffs. However, instead of using the review process to correct its erroneous practices, the United States has further increased tariffs and launched a new Section 301 investigation against China.
The Chinese side stated that the new 301 investigation lacks factual basis and goes against economic common sense. The United States is going further and further down the wrong path. It also stated that these tariffs not only harm China's legitimate interests, but also pose a serious threat to the interests of all members and the multilateral trading system.
The spokesperson of the Ministry of Commerce, He Yadong, once stated at the regular press conference that the accusations made by relevant US organizations against China are completely untenable. Several reports have pointed out that the main reason for the decline of the US shipbuilding industry is overprotection. The development of China's shipbuilding industry benefits from enterprises strengthening technological innovation, accelerating high-end, intelligent, and green development. The United States blames China for its own industrial development problems, lacking factual basis.
He Yadong stated that what I want to emphasize is that the US' Section 301 'is a typical unilateral measure that violates the basic principles of the WTO and is a blatant disregard and violation of multilateral rules. The previous "Section 301" measures taken by the United States against China have been found to violate WTO rules. I hope the US side will make cautious decisions and not repeat the same mistakes. China will closely monitor relevant developments, take all necessary measures, and resolutely defend its legitimate rights and interests.
Liu Bin, a researcher at the School of Government Management at the University of International Business and Economics and the China World Trade Organization Research Institute, once said in an interview with First Financial News: "Compared to the tariffs imposed on China during the Trump era, it can be seen that the industries and products subject to the tariffs are relatively concentrated, and the adjustment of the tariff amount is significant. For emerging industries such as new energy vehicles, the United States has a strong intention to restrict or restrict their development